Something interesting's afoot in the digital reading space. Quietly, companies are testing digital reading applications for portable gaming devices in select markets. Two developments of note:
EA "Flips" for Nintendo DS: A reader app for Nintendo's portable gaming system, offered for now only in the UK. Aimed at 8- to 11-year-olds (a good fit for the install base of the DS). Content partnerships announced with UK book publishers Penguin and Egmont. Revenue model will be bundled downloads of multiple (6-8) titles for an a la carte price of £24.99. Interactive elements include quizzes, operated with the DS's touch screen and stylus.
Marvel Comics and others on the Sony PSP: In August, Sony announced a digital reader app for the PSP that will launch in December in select countries (UK, US, Ireland, Australia, New Zealand and South Africa). It announced a content partnership with Marvel Comics and said there would be more content partners with comics, graphic novels, and manga publishers to come. Marvel digital comics are already available online via subscription ($10/month or $60/year). Details on the app don't say how much comics will be on the PSP.
Tomorrow, Barnes & Noble (B&N) is expected to announce its own B&N-branded eReader device--the Nook, as the Wall Street Journal reported this evening. The device is expected to be wireless and touch-operated, with dual screens--a 6" E Ink display for reading, and a smaller color LCD screen for navigation, video, and...ads?
In other words, the B&N eReader could be a Kindle and an iPhone put together.
I knew from conversations with my own sources that this would be a cool device, but I didn't expect that it would be priced, as the WSJ reports, at $259. This puts the Nook competing squarely with Amazon's Kindle 2--most likely with a razor thin margin, if any, for B&N. To steal market share from Amazon and make up for lost time, B&N is pricing the Nook as aggressively as possible.
Getting the price right is crucial to success in this emerging device market. As we published earlier this year, most consumers expect eReaders to be $99 or less. But we expected something in the range of $399, which would make the device competitive with the other touch + wireless eReaders on the market, the Sony Daily Edition and the iRex DR800SG, both of which will be sold at Best Buy among other retailers. Pricing the Nook a full $140 below these other devices sends a strong signal that B&N is focused on Amazon, not Sony, as competition.
As you've likely heard by now, Amazon has announced a price drop of the Kindle 2 to $259 and the launch of an international Kindle that will run on AT&T and partner networks in 100 countries. Here's our take:
Today we launched a new report, "Forrester's eReader Holiday Outlook 2009" (full version available to Forrester clients here), which updates our projections for eReader sales in 2009 and 2010. The data in this report comes from Forrester's consumer surveys as well as interviews with vendors and retailers.
E Ink recently announced that its 2009 revenues to date were up 250%, and were exceeding its earlier expectations. We, too, are observing the eReader market growing faster than we had expected: We published a report in May, "How Big Is The eReader Opportunity?", that pegged 2009 US eReader sales at 2 million. Our new report ups that projection by 50% to 3 million for 2009, with 30% of 2009 sales occuring in the holiday season of November and December.
There are a number of reasons why eReader sales are growing faster than we had expected, which we detail in the report, including falling device prices, more content availability, better retail distribution, and lots and lots of media buzz.
All these dynamics will compound to fuel more growth next year, and we expect more changes in the market that could push eReader sales beyond 6 million in 2010, bringing cumulative US sales to 10 million by year-end 2010. To get our full perspective on what will happen next year, you'll have to read the report, but here are a few highlights. In 2010, we'll see:
I am in mourning over the death of Gourmet Magazine. There's a revolution going on on Twitter (follow @savegourmet and search gourmetmagazine to see how it's developing) that I've been contributing to. But I'm taking off my fan hat and putting on my analyst hat to contribute something data-driven to the conversation.
I've been looking at some new, as-yet-unpublished data that I'm using in an upcoming Forrester report on reinventing magazine and newspaper subscriptions. Here's a preview:
And here's the same question cut by subscribers to any of Conde Nast's publications:
In other words, 19% of Conde Nast subscribers think their magazine subscriptions are "surprisingly inexpensive," compared with 13% of US consumers in general. The takeaway: Conde could probably be charging more for its subscriptions.